Instacart's new pay change is making some workers feel like second-class citizens

Instacart
Instacart, the online grocery delivery service, is rejiggering the pay structure for some workers, in a move that some argue amounts to big pay cuts.

According to a report in Recode, Instacart is boosting the hourly pay that some workers get, but then requiring they keep less of the tips. Ultimately that translates to as much as a 40% pay cut, by the calculations of some of the workers.

Workers affected by the pay change told Recode that the move reflects the two classes of employees of the richly-valued delivery startup. Executives on the corporate side enjoy a sweet gig while those doing the hard work are treated like second-class citizens. "It's totally a 99 percent and 1 percent thing," one Instacart worker told Recode.

With a private market valuation of $2 billion, Instacart is one of the most high-profile startups offering on-demand delivery services, including DoorDash and Postmates. But there are still many questions about the sustainability of the delivery model at the heart of the business, particularly amid competition from big players like Google and Amazon.

Instacart provided the following statement: "Attracting and retaining shoppers is vital to running our business. We have made some recent rate changes to reduce variability in how much shoppers earn, and we are constantly innovating to help shoppers get more orders. After these changes our shoppers will earn, on average, an effective rate of $15-$20/hour, which is both in line with historical levels and strongly competitive within our markets."